Intel prepared for shifts in computing, new CEO says

Sep 11, 2013 by Steve Johnson

Discounting critics who contend it is mired in the slowing personal-computer market, microchip giant Intel Corp. assured a gathering of industry experts Tuesday that it is well-positioned to profit from the fast-changing demands of consumers and businesses.

To highlight that point, the company's new CEO, Brian Krzanich, announced that the company is developing a new family of tiny, highly power-efficient chips dubbed Quark for the "Internet of things," a growing proliferation of smart devices ranging from wearable computing gadgets to municipal traffic sensors.

"I can't think of a more exciting time in our industry than right now," he said at the Santa Clara, Calif., company's annual gathering in San Francisco for its software developers. "Our plan is to lead in every segment of computing."

Tech analyst Patrick Moorhead said he was particularly impressed by the Quark announcement.

"It gets Intel into the huge Internet-of-things space where everything, no matter how big or small, is connected," he said, noting among other advantages that Intel might be able to license the technology to other chipmakers.

Although Intel long has been the dominant supplier of chips in PCs, that business is weakening as consumers have turned increasingly to tablets and smartphones. As a result, the company has been trying to branch out by getting its chips into mobile devices, a market dominated by other chipmakers using an energy-efficient design licensed from British firm ARM.

During Tuesday's event, Krzanich, who replaced former Chief Executive Paul Otellini earlier this year, said Intel is making good headway persuading mobile-gadget makers to use its chips. But beyond phones and tablets, he said, one of Intel's biggest business opportunities envisions virtually every consumer, industrial and other device eventually being computerized and connected to the Internet.

Renee James, who was named Intel's president in March and has been working closely with Krzanich to plan the company's future, said one example of that trend is in Dublin, Ireland, where Intel's chips are in sensors embedded in the city's street-drainage system. When streets flood, she said, the sensors automatically adjust traffic lights to divert motorists from the water.

Another example where the company's chips will be useful, she said, is in health care, where patients are already wearing Intel-powered monitoring devices that report their conditions in real time to their doctors. Moreover, she predicted that Intel's chips will help reduce the time and cost involved in sequencing patient genetic data, so medical care can be better tailored to their needs.

To highlight that last point, James introduced the crowd to Intel Fellow Eric Dishman, who had suffered for decades with kidney cancer and was frequently told his days were numbered.

"I think I've had maybe more predictions of my death than Moore's law," he said of Intel co-founder Gordon Moore's prediction that the number of transistors squeezed onto chips would roughly double every two years.

But then Dishman said he underwent a detailed genetic test and learned the treatments he'd been taking were ineffective, considering his genetic makeup. Now prescribed new medicine, he said, he's cancer-free.

Given the wide variety of functions Intel's chips will be able to carry out in the future, Krzanich said, "the landscape of computing has never been bigger," adding that for the company, "it's a landscape of opportunity."

Intel's stock price rose 8 cents Tuesday, or less than 1 percent, to close at $22.99.

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